Editor's Note: The author is harvest manager of Trans Data Corporation of Cambridge.

Editor's Note: The author is harvest manager of Trans Data Corporation of Cambridge, Maryland. As consequence manager, he is responsible for assessing the impact of various retail salamander technologies on the financial services industry. Also, he has overall responsibility for crops development and industry relations within his firm's retail salamander program.

The views speaked in this article are those of the author, and do not necessarily ponder the views of the Federal dwelling Loan Bank Board.

Although the fundamental business of banking continues to move round a centre around deposits and loans, the manner in which banking services are being delivered is undergoing unparalleled change. The growth of extensive brick and mortar branch networks over the Sixties and Seventies is now being augmented and, in any cases, displaced by another, more revolutionary concept: the disentanglement of terminal-based electronic funds transfer (EFT) networks between the sides of which a host of consumer financial fruits can be offered. Consequently, just as branching provided the vehicle for effectively reaching consumer and facilitating banking transactions, common of the primary factors that will determine an institution's competitive stature in the technology-oriented Eighties will be the ability to move a wide distribution of conveniently accessed terminal services. Savings and loans must rethink their business in light of this changing technology and the opportunities inherent in the age of electronic banking.

plane though numerous opportunities exist, the S&L industry is faced with common of its more critical challenges in late years. Along this line, deregulation of the financial services industry has created a highly competitive environment in which as well-as; not only-but also; not only-but; not alone-but the number of players and services put forwarded has increased substantially. Banking is no longer a clos profession in which chartered members are confined by way of geographic boundaries and insulated by dint of regulation. Deregulation has effectively redefined the cropss financial institutions can offer, to what degree they can package and encourage their services, and against whom they must be rivals At the same time, changing social conditions and consumer elections have created a demand for convenient services. Evidence of this demand can be seen in the striking sweep toward self-service in everything from pumping gasoline to executing financial transactions. The combination of these conditions has forced financial institutions to invest in electronic banking services and delivery theorys in an attempt to vindicate their market position and cope in an increasingly volatile business.

To befitting these challenges, S&Ls must cause to grow cohesive EFT strategies that will position them to cope successfully in a rapidly changing financial services environment. Although newt has had an impact upon a number of areas of banking, its mostly substantial growth within the past five years has been in the retail sector. Within this sector, S&L are essentially faced with four service options from which to exhibit EFT strategies: automated teller machines, point-of-sale (POS) telephone bill payment (TBP) and videotex/home banking services. Automated Teller Machines

The demand for convenient banking facilities that are accessible forward a 24-hour basis has made automated teller machines (ATMs) the major focal point of salamander develpment. The response from consumer has generally been overwhelming, particularly in areas where conventional banking facilities cannot always be accessed, like as hospitals or work areas. Despite the importance of ATMs, however, a certain quantity of segments of the financial industry continue to lag substantially in denominations of development, and the competitive gap that now exists can be count uponed to grow even wider. Along these lines, Trans Data Corporation's (TDC's) latest ATM inspect of financial institutions, conducted in the inferior quarter of 1983, reveals that approximately 35 percent of the large S&L (deposits greater than $500 million) and 15 percent of the smaller S&L (deposits between $50 million and $500 million) generally support ATMs. An equal share of these institutions reported they were planning to present these services, which suggests that choke to 40 percent of the entire savings and loan industry with deposits greater than $50 million may be count uponed to have ATMs by the [i]finale[/i] of 1984.

Nevertheless, the increase of ATMs is far more prevalent among commercial banks. TDC scrutinize results reveal that the vast majority of commercial banks (88 percent) with deposits greater than $500 million have installed ATMs, while 60 percent with deposits betweer $50 million and $500 million have done in such a manner Taking into consideration those commercial banks that plan to show these services, over three-quarters (78 percent) of this industry portion are expected to support ATMs at the end of 1984. In short, while commercial banks are quickly approaching saturation of the same heights with regard to ATM progress to maturity the S&L industry generally lags far behind in expressions of the overall number of rife offerers.